By Antony Akilade Fast growing IT software and services company Cedar Group Plc today announced its entry into the emerging ASP market with the formation of its e-Cedar ASP. CEO Mike Harrison was upbeat about the company’s ability to rapidly become one of the leaders in the space pointing out that it has as partners […]
By Antony Akilade
Fast growing IT software and services company Cedar Group Plc today announced its entry into the emerging ASP market with the formation of its e-Cedar ASP. CEO Mike Harrison was upbeat about the company’s ability to rapidly become one of the leaders in the space pointing out that it has as partners Compaq Computer Corp and MCI Worldcom Inc. Compaq will provide and operate the computer platform and MCI Worldcom will operate the secure network backbone and service delivery.
The Surrey, UK based company is listed on the London stock exchange and is set to announce first half results early in October. It is expected to report revenue growth of around 20% year-on-year. The company reported profit before tax for the year ending March 31, 1999 of 2.8m pounds ($4.48m) on revenue up 84% at 21.2m pounds ($33.9m). We understand also that Cedar Group is set to announce a round of financing as a prelude to an acquisition. It is likely that the group will either be looking to add functionality to its application portfolio or increase the geographic reach of the company. The company recently stated that it intends to build out its US beachhead operation Cedar Group Inc.
Initially e-Cedar will deliver the Cedar Group’s Cedar Financials application followed by browser based timesheet and expense entry applications, backed up by project and accounting systems. With the European Union’s Working Time Directive requiring all businesses to keep records of employee work-hours due to be implemented in the UK, this functionality could prove attractive to businesses in the UK in the near-term. Cedar plans to extend its e-Cedar offering to incorporate workflow, CRM and knowledge management applications over the coming year. The service is aimed principally at the SME market but Harrison reports interest from a number of large organizations in the petrochemical and finance sectors. Cedar Group began life as a payroll-processing bureau in the early eighties and the Group must have a sense of deja vu as it moves into this new mode of application delivery.
Details of the cost of the new service were not made available. However, Harrison stressed that the offering would undercut the cost of deploying the applications in-house. But the issue really is how Cedar will be positioned against competitor ASPs. Harrison said that final pricing would be fixed by the end of November. We already have around five or six customers keen to be involved in pilot projects and we believe we will ramp up to the 100’s quickly and four figures by end of calendar year 2000, he said. The UK Atomic Energy Authority has been up and running with the service for the past three years. Harrison went on to say that he expects the e-Cedar service will be spun off as a joint venture sometime in the next calendar year.